Macy’s Inc.
M 4.20%
finance chief Karen Hoguet will retire within the next year, after more than 20 years in the role.

Macy’s said it is conducting an external search for her successor and has hired an executive search firm to assist the process. Ms. Hoguet, who has been CFO since 1997, will remain at the department store chain in an advisory role until Feb. 2, 2019, to ensure a smooth transition.

Macy’s is considering only outside candidates at this point, according to a company spokeswoman. Although the company has strong internal finance talent, a decision was made to look externally first, she said. In 2017, 44% of new CFOs were hires were external ones, according to the
Crist | Kolder
Volatility Report.

Macy’s and other retailers have struggled with falling sales in recent years as shoppers make fewer trips to malls and do more of their spending online. The company has responded by closing weaker locations and ramping up e-commerce investments.

This year, however, retailers have largely reported rising sales as strong economic growth and consumer confidence drove holiday selling. Macy’s same-store sales declined for more than 10 consecutive quarters until a strong holiday season lifted sales 1.3% for the quarter ending Feb. 3.

“Companies have not adapted to a new reality and they are not ready for it,” said Giovanni Lamarca, a managing director at recruiting firm RSR Partners. “So Macy’s and other companies have started to look outside for talent who can propose different solutions that they are not seeing.”

The current management team is a mix of internal and outside hires, which has been “a factor” in the company’s improved performance, the spokeswoman added.

Many CFOs in the retail space are older and more experienced, but headed for retirement at a time when the industry is being transformed by e-commerce, said Steven Barr, consumer markets leader at PwC. There was a high level of turnover—18%—in the retail and consumer markets sector last year, according to executive recruiter
Korn/Ferry International.

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The talent turnover is an opportunity for companies to ask whether their internal talent bench fits their needs, Mr. Barr said. “Do they have the ability to adapt in the new environment or is there a need for those companies to fill the CFO roles with new candidates who bring a different business acumen based on the evolution of the retail environment,” he added.

Ms. Hoguet began her career at Federated Department Stores in 1982, which bought Macy’s in the 1990s. She worked with former chief executive Terry Lundgren for several decades, becoming CFO six years before he became CEO.

“For the past three decades, Karen has had a voice in almost every major decision,” said current Chief Executive Jeff Gennette in a written statement. “Through good times and bad, Karen has been a steady and strategic hand.”

—Ezequiel Minaya and Tatyana Shumsky contributed to this article.

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